A merchant account is a business bank account. A merchant account allows a business to accept funds in a variety of ways including from electronic payments such as credit or debit cards. Since it's a business bank account you'll need a business license to set one up.
What is a merchant account and do you need one?
- In most cases, you need to have a merchant account if you want your business to be able to accept card payments. Essentially, a merchant account processes electronic card payments between a customer’s bank account and your business bank account. Simple, right?
How to set up a merchant account?
- Choose a card brand or brands that you prefer. ...
- Check the rates and fees and compare them across other similar providers.
- If you plan to service international customers,then confirm that your merchant account will permit sales in all of the countries where your customers may be.
Is a merchant account vs payment gateway?
- As you can see, a payment gateway is different from a merchant account - they’re responsible for two separate processes. While a merchant account is for the receiving and holding of funds from card transactions, a payment gateway is simply a consumer-facing interface that collects card data - an online checkout portal, for example.
How much does a merchant account cost?
- To set up a retail merchant account, you'll first need a credit card terminal. They run $150 to $1,000 each, or can be leased for around $50 to $100 per month. A merchant account comes with a variety of fees. Some are periodic and others are recurring based on the amount and type of transaction.